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Will these documents satisfy my lender's ‘gift’ requirements?

 

Q: I received a gift from my mother for a mortgage. She withdrew it from her savings account and gave it to me along with a bank statement showing the withdrawal and last 30 days of account activity. I deposited the funds into my account and got a bank statement. Is this a valid way to verify transfer of funds? The gift letter says use a check but she was all out of them at the time.

A: You'll likely need to get an OK from the mortgage lender that the documents you have to prove the gift are acceptable. Your mortgage lender will probably also require that your mother draft a gift letter describing the transaction and amount, and it will typically will be required to be notarized.

Check with your loan originator or processor for details. If the arrangement you made with your mom is unacceptable, you may simply have to give the funds back to her and have her write a check for it to meet the lender's requirements.

About the author:
A 25-year expert observer of the mortgage and consumer debt markets, Keith Gumbinger has been cited in thousands of articles covering a wide range of consumer finance and economic topics in outlets ranging from the Wall Street Journal to the Bottom Line newsletters. He has been a featured guest on national broadcasts for CNN, CNBC, ABC, CBS and NBC television networks and has been heard on NPR and other national and local radio programs. Keith is the primary researcher and writer for HSH.com's MarketTrends newsletter and has authored or co-authored a number of consumer guides on mortgages, home equity, refinancing and more.

 

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